Hotel company Scandic is updating its debt target and providing information about upcoming share buyback programs and proposals for an extra dividend. This is stated in a press release.
Scandic Hotels has set financial targets for the period 2025–2027. The target for net debt in relation to adjusted EBITDA is reduced from 2–3x to below 1x.
Scandic further intends to return at least SEK 1,200 million to shareholders during the period 2024–2026 and in addition to the regular dividend.
”"This is partly due to the fact that the convertible loan that Scandic issued in 2021 has now been settled," it says.
As a first step, Scandic will launch a share buyback program in December 2024 of approximately SEK 300 million, which is expected to run until May 2025, and will shortly call an extraordinary general meeting to propose a decision on an extraordinary dividend of approximately SEK 550 million, it further states.
In addition, Scandic announces that it has recently repaid the entire debt of SEK 631 million for deferred VAT and employer contributions, linked to the pandemic years, to the Swedish Tax Agency in advance.
SCANDIC'S NEW GOALS
The new financial targets in their entirety and dividend policy 2025–2027 are as follows:
• Organic net sales growth of at least five percent per year.
Previous target: The Group's organic growth, i.e. sales growth excluding company acquisitions, corrected for exchange rate changes, shall amount to at least 5 percent per year on average over a business cycle.
• Profitability target of an adjusted EBITDA margin of at least 11 percent per year.
Previous target: The Group's adjusted EBITDA margin shall be at least 11 percent on average over a business cycle.
• Net debt in relation to adjusted EBITDA should be less than 1x.
Previous target: The Group's net debt in relation to adjusted EBITDA should amount to 2–3 times.
• The new dividend policy is to distribute at least 50 percent of net profit. The dividend is based on net profit excluding the effects of IFRS 16.
Previous policy: Scandic's dividend policy is to distribute at least 50 percent of the year's profit.
Source: Dagens Industri
